CLAUSE 9.—(Application to Scotland.)

I imagine that it will be for the convenience of the Committee that we should not take up time in discussing this Amendment in view of the fact that we had a rather prolonged discussion on what amounted to the same subject on Thursday. We should therefore rather conserve our time for the other material points that are to come on later. I formally move the Amendment, so that, if others desire to speak upon it, I shall not stand in their way.

There is a question I should like to put with regard to the definition. The definition of agricultural hereditaments has gone out so far as it applies to Scotland, and, in dealing with Scotland, we have to go back to the 1854 Act for a definition of land and hereditaments. The only definition in that Act is where it says:
The expression 'Lands and Heritages' shall extend to and include all lands, houses, shootings and deer forests,
and so on. If the definition of agricultural land has gone out, I would like to know what is the definition of agricultural land that is intended in Sub-section (4) of this Clause?

I beg to move, in page 9, line 36, at the end, to insert the words:
and, in the case of agricultural land and heritages, the value of the house and cottages situated thereon shall be shown separated from the value of the agricultural land.
Sub-section (4) is to the effect that certain marks shall be put in the valuation roll to show what are agricultural lands, what are industrial lands and what are freight-transport lands, and I want to take the opportunity of this revision of the marking of the valuation roll for Scotland to put in the value of the farmhouse which, up to now in Scotland, has not been shown separately
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from the value of the farm. I consider that it is desirable to do this at this stage, for reasons which I will give. There is no harm in knowing the value of a farmhouse separately from the farm itself and the agricultural buildings or steadings thereon. It is, of course, the English practice to show the value of farmhouses separately, and I do not see any harm in knowing it. The assessors, who are public servants, would do this without expense, and the valuation could be arrived at by the assessor putting a value on the farmhouse, subject, of course, to appeal to the assessment committee of the county council or even to the High Court in the event of dispute.

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Unlike those hon. Gentlemen opposite, who voted on Thursday last against Scotland having the advantage of this general scheme of de-rating which has been proposed for the whole of the country, my hon. Friends here consider that the advantages will be very great indeed, and the line we take is that we want Scotland to have the full advantage of what is going to be done. I am not going into the whole question of the derating proposals towards which this Bill is only a step, but I would like to be allowed to quote what the Chancellor of the Exchequer said in bringing in his Budget:
Farm lands and buildings will, therefore, from and in October, 1929, that is, after the rate payment of April, 1929, be at once completely and permanently relieved of all rates. The farmer will continue, of course, to pay rates on his residence in the ordinary way; but, so far as agricultural production is concerned, he will be entirely free. There will be no chance of rates being raised upon him for any cause or in any district. The whole business of assessment and re-assessment, as far as he is concerned, comes to a final end. Out's out. To him, after the middle of next year, the rates are dead, and, as the poet said, "Stone dead hath no fellow."—[OFFICIAL REPORT, 24th April, 1928; col. 865, Vol. 216.]
That is what the Chancellor of the Exchequer said. I would like to quote, with regard to that, from a leaflet or pamphlet issued by the headquarters of the Conservative party dealing with these rating reform proposals, in which it says:
Agricultural land and buildings which already enjoy relief to the extent of three-fourths of the rates should be completely and permanently relieved of all rates, the farmer continuing to pay rates on his residence in the ordinary way.
When my right hon. Friend the Secretary of State for Scotland came to explain the definite provision that would have to be made in this matter to adapt it to the Scottish system, he told us quite clearly that his plan, among other things, was not to value the farmhouse on the farm separately, according to the English fashion, but to make an allowance of, I think he said, one-sixth of the value of the farm and to take that as being in all cases the value of the house. It is, I think, assuming a great deal to say that one-sixth of the value of a farm represents the value of the house in which the farmer lives. In may be so in certain cases, but it is certainly not so in a very large number of other cases.
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Even supposing you do adopt that as a general rule, you will not be able to say, when this new de-rating system is brought into existence, that you have derated agricultural land in Scotland. You will still be charged with rates on one-sixth of its value. Therefore, this leaflet or propaganda pamphlet by our party should not be circulated in Scotland, because it will not, strictly speaking, be true. It will not be de-rating the land. That is a clear exposition of what my proposal amounts to. Unlike hon. Gentlemen opposite, I entirely approve of the idea of de-rating agricultural land. I consider that it will bring a great advantage to Scotland, but, as I said before, the Scottish farmer will be in an unfavourable position as compared with the English farmer if my right hon. Friend's proposals are carried out.

I support the general proposals, but I wish to make this Amendment in order that Scotland may have fairer play when these general proposals are carried out. Surely, that is quite clear. Take the owner-occupiers, who every day are getting more numerous in our country. May I say that in the parish in which I live I am the only landowner who is not an owner-occupier. All the others in my parish are farmers who own and farm their own farms. That is getting more and more the case all over the country. On our side of the border, he will still be rated on his land whereas if he were in England he would be merely rated on the assessed value of his house. There is also the case of the parcels of land, grass plots, small farms and so on on which there is no house at all, and allotments. I should like to ask, and perhaps the right hon. Gentleman will inform us when he replies, whether it is his intention or not to put the burden of one-sixth of the value of an imaginary house upon those subjects or not. That is a point upon which I should like to be informed.

I do not want to go into the whole question of the general scheme more than is necessary, but I should like him to inform the Committee as to whether he still sticks to the fraction of one-sixth which is proposed as being the assumed value of a farmer's house upon his farm. It is quite certain that that
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will lead to very great inequalities. There will be a great deal of grumbling in many cases. Many farmers will think that having to pay rates upon one-sixth of the value of their whole farm, instead of the actual value of their house, will lead them into being called upon to pay higher rates than they consider that they ought to be called upon to pay. There will also be the jealousy of the other people—the butcher, the baker and the candlestick-maker, who all pay rates upon the value of the house in which they are living. They may think that some farmer or other is paying too little in the way of rates, because of this convention which my right hon. Friend recommends. In fact, I submit that the only fair way is to make it the same all over the United Kingdom. The value of the house in which a man lives is taken to be a rough measure of his ability to pay rates. It is not, of course, in every case a just and an accurate measure of his ability. Still we have been accustomed to take it as the measure of his ability to pay rates, and it is a thing from which you cannot get away. There will be no arguing about it if you simply adopt all over the country the system of calling for rates to be paid on the value of a house in which a man lives, and in no other way. I believe that one reason why my right hon. Friend, from whom I am very sorry to differ on any small point, has adopted his suggestion is that in the cases of crofters and smallholders the English system will operate unfairly. I am not sure that that is going to be the case. I have had the actual figures of many existing eases put before me, and it has not always worked out so.

Crofters have always been specially treated by our laws, and there is no reason why they should not be specially treated in this particular way. They are marked off as a class by themselves, and some special proviso could be made to meet their case. I am dealing with the Lowland farms with which I am accustomed. I know comparatively little about the Highlands. This is my proposal. It has been greatly discussed in Scotland. Associations of various sorts have had it under very keen discussion. Some of them think my way, some of them think the other way, and one particular
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association has recently changed its view. But I think the people who took part in those discussions probably judged this matter from their own particular case, or from the cases of their friends around them. I think that Scotland is going to lose by not being exactly on the same terms as England in this matter. It is not right to say that I am advocating that the English system should be applied to Scotland. There is nothing particularly English about it. I do not know when this particular difference of not showing the value of the house separately from the farm arose. I do not know what the history of it is or how it came about. But there is nothing particularly Scottish about it. It might just as well have happened that England might have adopted the other system, and we might have adopted what is now their system. I am suggesting that the same rule should hold good in both cases. That is all that I say.

I do think that we in Scotland are going to lose by this if my right hon. Friend's suggestion is adopted. There will be a change in the rents of farms. A change in rents of farms may mean that the rent may go up or it may go down, and that will alter the incidence of rating in Scotland in rather an awkward way. There will be a change, perhaps, in the Government grant which is going to be made from the general Treasury to the whole country to meet the needs of Scotland. We have always lost in that way when these sorts of changes have been made, because when you deal with agricultural land and such things the tendency is for legislation in the first instance to be with reference to the English system, and to the conditions which prevail in England. Then perhaps a year or two afterwards you have to pass another Act of Parliament in order to meet the case of Scotland. It has happened in the past, and, I fear, will happen in the future, if my suggestion is not adopted. When changes take place, Scotland will be adversely affected and will not get her fair share of what is going, and Scottish agriculture will be prejudically affected as compared with England. Does the right hon. Gentleman still adhere to the fraction of one-sixth? It is rather important that we should know that, because
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we have been going into these figures and we are of opinion that one-sixth is too small. [HON. MEMBERS: "Too large!"] Well, it is not the right proportion. I will put it that way. It is rather difficult working out vulgar fractions. A fraction of one-eighth has been mentioned. That would be rather better, but it would be better still, if the right hon. Gentleman must have his way and if he will not adopt my way, that the fraction should be one-tenth or one-twelfth. That would be fairer for Scottish agriculture.

I rise to support the Amendment. The Government have told the House and the country that it is their intention to de-rate agricultural land and only to make an assessment upon the farmhouse and the farm cottages. They are not carrying out that promise unless they accept this Amendment. What my hon. and gallant Friend is arguing for, and what I am arguing for, is that the farmer should be assessed as every other man in the country is assessed, whether he be a tradesman or a private individual, on the value of his house. The proposal which is made by the Secretary of State for Scotland is a totally new method of arriving at the assessment. He makes the novel proposal that the value of the house should be taken at one-sixth of the gross rental of the farm. The approved and existing system of valuation and assessment ought to be adopted, and under that system the farmer would be put in the same position as everybody else in regard to the assessment on his house. If the Amendment is not to be accepted, let us see what an extremely awkward position we shall be in. My right hon. Friend says: "We will not separate the farmhouse and the farm cottages, but we will take an arbitrary valuation of one-sixth." In that way, we get into an awkward position. On many farms you have more farm cottages than on others. In other parts you have sheep farms, which comprise a very large area of our country, with perhaps only one cottage for the shepherd, or two cottages, while in the arable districts you will have several cottages for the workmen. In some counties there is the system known as the bothie system, which is a bad system.

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By making a uniform valuation that all the houses, whether they exist or not, shall be considered to be one-sixth of the gross rent of the farm, you are going to create a situation in which many anomalies will be created and injustice will be rampant. All that we ask is that the approved and recognised system of assessment should be adopted in these cases, and the onus rests on the right hon. Gentleman to prove that in making the novel departure which he proposes he has any solid foundation for so doing. In the case of England, the farmhouse and the cottages for the workmen are separated from the land for assessment purposes, but my right hon. Friend is not following that precedent. The various representative bodies in Scotland have recognised that in making this novel departure the farmers and the owners in Scotland may have an unfair aspersion cast upon them. It may be said of them: "You are receiving special and favoured conditions. You are not assessed on the value of your houses, as the butcher or the baker is assessed. You get special preferential treatment." We do not want that charge to be leviable against the owners and farmers in Scotland. We ask for no favoured position for them. All that we ask is that the farmhouse and the cottages for the workmen should be valued as is done in England, and as has always been done in England.

My right hon. Friend may say that it is difficult to value separately the farmhouse and the cottages, but I would point out that prior to 1924, when the Inhabited House Duty was removed by the Socialist Government, the value of the farmhouse was in the valuation roll. We have only to look back at the valuation roll prior to 1924 to see the value of the farmhouse. As regards the cottages, we all know that owners and farmers always had to put in the value of the cottages. Although that was done, for what were called franchise purposes, the fact remains that it was done, and without any trouble the assessors in the county could revise the figures. Therefore there is no difficult machinery involved in the Amendment. I cannot understand any hon. Members opposite objecting to the generally accepted and approved system of assessment which we suggest should be adopted. It is a
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plain, honest, straightforward system. We only ask that the farmhouse and the farm cottages should be assessed, where they exist, on their value. Instead of this regular method, which we advocate, the Secretary of State for Scotland proposes that one-sixth of the gross rental of the farm should be put opposite the value of these particular subjects. I am certain that if he follows that course there will be a great outcry in Scotland. It will be said that Scotland is not getting the same treatment that is being given to England. If my right hon. Friend adheres to that fraction of one-sixth, although it may seem an unimportant matter, there will be gross injustice in a great number of cases. In the County of Forfarshire, which I represent, we have farms where the rental is, say, £900. That would mean that the farmhouse and the cottages would be assessed at £150. The thing is absurd. We ask that they should be assessed on what they are worth. If they are worth more, let them be assessed at more, and if they are worth less let them be assessed at their value.

I appreciate the differences of opinion which have been expressed upon this subject and I want the Committee to realise at the outset that in taking the steps which I have proposed to deal with this problem upon a percentage and not upon the direct valuation of the farmhouse and the farm cottages, it is not I who am making a departure, but it is those who ask me to take other steps who are making a departure. What is the history of valuation in Scotland as compared with England? In England they have always separated the buildings from the land. That has been a long-established custom. It is equally true that my right hon. Friend the Chancellor of the Exchequer, in speaking upon the proposal to assist productive industry, explained to the House, in plain and unmistakable terms, that, so far as England was concerned, they proposed to arrive at the measure of relief which they were proposing to give to the agricultural industry, as a productive industry, by following the well and long-established English precedent of totally de-rating
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the land and the farm buildings and of leaving the farmhouse and the farm cottages as they were at present, namely, rated upon their particular value. The right hon. Gentleman, in equally unmistakable terms, added that in view of the fact that there was great diversity of method and procedure in Scotland it would be my duty to explain to the House the method under which we proposed to arrive at the total relief of the productive industry of agriculture in Scotland. It may well be that in presenting the case to the House I may have failed to make myself entirely clear, and I want to-day, if I can, to bring back to the House this fundamental point, that we are concerned in Scotland in giving, as nearly as we may, a similar measure of relief, no more and no less, to the agricultural industry in Scotland to that which is being achieved in England.

Working in that manner, I suggest to the Committee and to Scotland that as in the past it has been the established custom of our country to value not the farmhouse and the cottage separately but to take the farm as a unit and to value it as a unit and to enter it in the Valuation Roll as a unit, by adopting a percentage upon the gross rental we are maintaining the long-established, well-known custom of dealing with this problem in Scotland. All that concerns the Committee in the present Bill is not whether the percentage I have suggested—one-sixth—is the proper and just percentage but whether provision shall be made for differentiating between these different subjects. That is, in fact, the only question which the Committee has to decide. It has been already pointed out by the hon. and gallant Member for North Lanark (Sir A. Sprot) that if the houses were separately assessed it would raise a fundamental difficulty with regard to the crofting areas and the small landholders in the country, and he suggested that it should be dealt with in some other way. I think it would be very desirable if we can, with a fair measure of justice to all concerned, arrive at a broad general method rather than introduce a number of exemptions and alterations. It may be, taking the system I suggest, that certain anomalies will be found. I do not know any system of valuation which will not have anomalies at both
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ends of the scale, but I am concerned not with a small number of anomalies but with getting for the agricultural industry of Scotland, on a broad and understandable basis, an equal measure of relief to that which agriculture gets in England.

I pass from the crofting districts in Scotland to the small farms. We find in Scotland a larger proportion of small agricultural holdings than in England, and that of itself should make hon. Members consider carefully the effect of this Measure on a moderate sized holding of from 100 to 150 acres. In the past our system has been to ask the holder of agricultural subjects to pay rates on one-quarter of his holding value, and I am suggesting that in future he shall pay one-sixth. I am, therefore, with one stroke of the pen, giving a reduction of rates to every individual tenant in the country. On the other hand, when I look at the larger farms I ask myself whether this is going to be reasonably fair towards these farms or not. One may point to the large farms and say, "Here is a large farm where a man is paying a rent of £900," as in the case referred to by the hon. Member for Forfar (Sir H. Hope), and contend that it is unreasonable to say that that fraction truly represents the value of the farmhouse and cottages on that holding. The hon. and gallant Member for North Lanark and the hon. Member for Forfar put far too much stress on the question of the value of the houses and cottages and far too little on what I will call a fair and reasonable contribution of this productive industry towards the support of local rates.

While relieving productive industry, either agricultural or in the manufacturing centres, it is part of the Government's policy to say that both shall pay a measure of contribution towards local services. It is on that basis that I am proceeding with the proposal of a percentage. I have watched with interest the discussion which has ensued upon these proposals in Scotland. It is a very complicated problem, and one upon which those who have studied it may rightly and properly take different views. But I am fortified in the position I have taken up by the fact that the more I have discussed it with representative farmers throughout the country the more certain am I that a percentage, whether it is the
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present percentage or another, is the proper way of achieving the end by which agriculture in Scotland, with the fewest anomalies and inconsistencies, shall have the same benefit as agriculture in England. Take the Chamber of Agriculture in Scotland. It is true that the executive of that body met and discussed this problem immediately after it was mooted. It is true that they came to a certain conclusion, which they were prepared to recommend to the larger gathering of the Chamber of Agriculture. That conclusion was in favour of a direct valuation of the subjects, but when they came to the larger arena and discussed it with the rank and file of the agricultural community the result was that the proposal of direct valuation was not even pressed to a division; those who had so hotly protested in favour of it did not have the courage to carry it to a division in the Chamber.

There is this further point. I have met deputations from other agricultural bodies, and they have said quite frankly that they can point to this and that anomaly. I have replied, "How do you propose to deal with the case of the small farmers, the case of the crofters, the case of the smallholders, and their answer was, "That is your affair." It is my affair, and I propose to make it my affair. I think the hon. and gallant Member, after further consultation with agricultural interests in Scotland, will come to the conclusion that there are considerable advantages to be gained by the method proposed. It is quite clear, from the Treasury point of view, that we must have some idea of where we are, and it is only by taking a broad principle like this that it can be achieved. Another important point in considering this question is that landlord and tenant in Scotland are perhaps more closely interlocked in the management of agricultural estates and farms than in England. Landlords have always borne a portion of the burden of the rates, and in recent years they have borne that burden to an increasing extents—three-quarters as against the quarter of the tenant—and when I look around the agricultural position in my own country, as it is my duty and pleasure to do, I find that there is a great deal which ought to be done and should be done towards the improvement of the cottages of the workers on the land.

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Anything which will help to stimulate and increase this will be to the advantage of the workers in the industry. If you are going to take individual houses and cottages, and every time that a landlord makes improvements on these subjects he is to be, liable to an increase of assessment and rating, you are doing what in my judgment is contrary to the interests of the great mass of those who are employed on the land. I hope the Amendment will be withdrawn and that we shall leave the position in Scotland to be worked on the same basis as in the past. With regard to the problem of the fraction, I invite all those who are interested to examine the matter carefully and produce if they will any figures or arguments which may bring pressure to bear upon myself and my office or upon His Majesty's Government as a whole. I am advised that we have by this fraction arrived at a figure which will be reasonably fair compared with the general relief given to the agricultural industry in England. If it can be shown that it is not so I am ready to listen to those arguments.

I hesitate to intervene in the pleasant family difference which exists between the Secretary of State and hon. Members opposite. On this occasion I agree wholeheartedly with the Secretary of State. He has taken a wise and statesmanlike view of the situation, and hon. Members on these benches felt that the end of his speech was full of hope. He suggested that if we accept the percentage basis, which we do, and bombard him with facts and figures and statistics, that he is not altogether adamant. We can approach him with some degree of hope. I am quite convinced that direct valuation is the wrong basis, and the Secretary of State, by his exposition of
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the broad general principle, has explained why in all the circumstances of the case the percentage basis is right. When I saw the Amendment on the Order Paper I frankly thought there was a great deal in it. I am certain, however, that it would create a flood of anomalies. I gathered, however, that there was hope in the speech of the Secretary of State that the real difficulty and anomalies might be overcome. I have a great deal of sympathy with the large farmer who fears that he is going to bear the biggest share of the agricultural taxation of the country. The case which the hon. Member for Forfar (Sir H. Hope) gave is a case in point. A great many of these cases will undoubtedly arise and they will have to be met, and I hope that the Secretary of State will meet them sympathetically. I know of a case where the rent of the farm is £1,200. At the present time the house is included in the valuation, and it is valued, I understand, at £50. If you are to rate farms on the percentage basis you will rate that house at £200. The situation which arises is a very difficult one, which I trust the Secretary of State will consider sympathetically. That is the case of the large farm.

Take the case of the smallholder and the small farmer. I am glad that the right hon. Gentleman has taken such a determined attitude on behalf of the percentage basis so far as the smallholder and the small farmer are concerned. The Amendment seeks to embody the English system into a Scottish Bill. There is no doubt about that. In Scotland we have always regarded the unit as a composite unit for rating purposes; we have never valued the house part from the land or the land apart from the house. If the Secretary of State were to introduce the English system, there would be a breach of faith with the smallholder, for under the various Acts the smallholder in Scotland is now exempt from the rating of his house and improvements. That system has been in existence, so far as the smallholders are concerned, for nearly half a century. Would the Secretary of State be right or just in introducing a new system? I think it was Mr. Norman Reid who pointed out in a report that it would be a distinct breach of faith with these smallholders. I am glad, therefore,
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that the Secretary of State has taken the bold course and the Scottish course and the natural course, and has treated the farm as a distinct and composite unit, not the house apart from the land or vice versa.

I am sure that the Committee listened with great interest to the Secretary of State when he said that this is merely the beginning of the fight. I am paraphrasing his words. That is the point which I made in the Debate the other day. The people of Scotland have not yet realised the difficulties and the dangers that are in store for them. My right hon. Friend the Secretary of State may laugh, but to-day I have received no fewer than seven letters denouncing the prospective proposals of the Government, of which this is merely a fleabite. The Government expect at the end of this year to abolish all rating authorities—parish councils, school management committees—[HON. MEMBERS: "Order, order!"] I am merely showing how important this is. If I am out of order no doubt the Deputy-Chairman will tell me so. In any case I was about to end my remarks. I am speaking for the party to which I belong. While we have a great deal of sypmpathy with the case put by the two hon. Members who moved and seconded the Amendment, so far as the large farmers are concerned, we are convinced that the Secretary of State has taken the wise and right course in maintaining the traditional Scottish system of rating and of valuing a unit as a composite unit. So long as the right hon. Gentleman proceeds on those lines and extends the percentage from one-sixth to one-tenth or one-twelfth, which I think he feels bound to do, we are entitled to support him in the present proposals of the Bill.

With the exception of my hon. Friend, who takes a very keen interest in taxation matters. The reason why most of us on this side support the right hon. Gentleman's attitude in this matter is precisely the reason that, I should have thought, would have satisfied my hon. Friend. Once a percentage
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is fixed, once a basis is fixed, there is every encouragement for the provision of new workers' cottages on an estate, because every additional cottage then built will not be subject to rates at all, and consequently every additional building of a workman's house, not subject to local rates, on an estate, will assist greatly in the improvement of working-class houses in the rural areas of Scotland. For that reason and for that reason alone, we would be prepared to agree with the right hon. Gentleman against the view taken by the two hon. Members who spoke in support of the Amendment. But there is no sense in disguising the fact that while that is so, you will under this proposal have cottages on agricultural land that will be bearing no share whatever of the local rates—new buildings after the one-sixth is eaten up. Whatever new buildings are built will be built rate free. I think that is so. I am hoping it is so. New cottages which are built will be built local tax free.

You will therefore have cottages on rural estates in Scotland which will be bearing no local taxation, while the tenants of industrial properties in the boroughs and villages will continue to pay and have no share in the relief. The right hon. Gentleman is on the slippery slope. I am glad to see him there. I hope that he will follow his decision to its logical conclusion. If he does so, he will de-rate all tenants' houses, whether they are on agricultural subjects or otherwise, with a view to the real and permanent encouragement of house building in this country. I take it that there is no greater barrier to the building of working-class houses for the poorest of the poor than the fact that every new house erected is immediately subject to the handicap of local rates. I saw an ingenious proposal made by a late Member of this House——

The DEPUTY-CHAIRMAN

The hon. Gentleman would not be in order in dealing with the question of de-rating industrial hereditaments.

While we approve of the step that the right hon. Gentleman is taking this afternoon, in so far as we believe that it will logically end in the de-rating of future rural cottages, we see no reason why he should stop there; we cannot see his justification for taking up an attitude that will mean ultimately the de-rating of rural cottages and the 100 per cent. taxation of urban cottages and dwellings of the poorer tenants. We trust that in further stages of this Bill, and in succeeding Bills which must necessarily follow, the right hon. Gentleman will have regard to the very serious anomalies that his present attitude will bring about unless he carries the matter further and adopts for the tenants in urban areas the policy which he is willing to adopt for the tenants in rural areas.

As far as this Debate has gone, I think it is a really good augury that for once Members of all three parties are in agreement on a matter which is of real value to Scottish agriculture. In my not very long experience of the House I do not recollect a similar situation having arisen. It may be one of the indications that are not altogether absent otherwise, that the time may not be far distant when something like an agreed policy with regard to agriculture—a national policy—may be forthcoming. I shall not say more on that very wide topic. I rose merely to urge—though urging is not necessary—my right hon. Friend to continue in the method that he has adopted, namely, the fractional method of valuing the Scottish farmhouse and cottages, rather than the door-to-door and house-to-house valuation recommended in the Amendment. The arguments in favour of the method which my right hon. Friend has adopted have been so cogently put by the two last speakers that I shall not repeat them. One additional remark must be made. It has already been pointed out how valuable it will be for the increase and improvement of rural housing in Scotland that each separate dwelling on a farm should not be separately valued.

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A further point in that connection is this: There is a tendency, perhaps more marked in England than in Scotland, towards what is called the ranch system of farming. There is a school of agricultural thought which believes that ranching, that is to say, the creation of wide expanses of farm land, with a very small amount of labour and few houses, is, for large parts of England, and, possibly, for some parts of Scotland, the proper future of agriculture. I have never believed that theory, and I am glad that the method which my right hon. Friend has adopted in this case will—as far as it can be done in this connection—put a spoke in that wheel. Had the alternative method of house-to-house valuation been adopted, the tendency would have been to check the building of new houses or the improvement of existing houses. In certain cases where more than one farm is held by one owner it actually would have brought about a tendency towards the non-maintenance, and even the demolition, of existing cottages and houses. The demolition of existing houses is, of course, part and parcel of the ranch system, and I am sure that the change proposed in the Amendment, from the valuation of the agricultural subject as a whole, to the separation of the houses from the land, would tend, as far as rating can do so, to develop the ranch system in Scotland. That is another reason why, in my judgment, the Secretary of State has made a right decision.

The question arises, however, of whether my right hon. Friend has adopted the right fraction or not. I cannot myself think that he has adopted the right fraction. If you try to strike an average of the farms and of farming in Scotland on the overhead method—the only method which you can employ—I cannot believe that you will find the farmhouses and cottages represented by one-sixth of the total. I am sure it must be nearer one-eighth, and I am not at all certain that an even smaller fraction could not be worked out as correct. This is the only matter, I think, upon which Scottish agricultural opinion will find itself at variance with my right hon. Friend, when this question has been fully threshed out, because I do not believe that Scottish rural opinion—that is to say the opinion of those who
1897
know about the subject—will be honestly satisfied that one-sixth is the correct figure. I strongly urge my right hon. Friend to reconsider that point. I know that this is not the time for my right hon. Friend to say what figure he has in mind. I am grateful to him, however for having said that the one-sixth is not a fixed adamantine fraction, and I assure him that that unanimous Scottish opinion, to which I alluded at the beginning of my remarks, will be concentrated upon encouraging him, if I may use that expression, to adopt a fraction certainly of one-eighth, if not of one-tenth. Having dealt with that single fact, I wish to add my congratulations to those already expressed on the decision of my right hon. Friend. It was not an easy decision because it is possible, unquestionably, to find certain anomalies, but it is a decision which puts all the tendencies in the right direction, in place of a decision which would have put them all in the wrong direction. That has been made perfectly clear by the arguments which we have heard from both sides of the Committee.

I am sorry to intrude the poison of dissension into the very grandmotherly, mutual association sort of Debate which has developed. It may be said that a Member representing an English Division has no right to intervene on this occasion, but one or two points of cardinal importance seem to have been overlooked. The Secretary of State played a very fine trick, if I may say so, in his summing up and he played it so deftly that my colleague the hon. Member for Dundee (Mr. Johnston) fell straight into the trap. The right hon. Gentleman pointed out that as far as small allotments were concerned, this one-sixth would he a safeguard against the constant encroachments of the rate-collector and that, indeed, it was the idea of keeping back the increase of rates which caused him to hit upon the one-sixth fraction. The hon. Member for Dundee snapped up the suggestion and I wish to put him on his guard. The hon. Member for Dundee went on to suggest that there would come a time when the one-sixth would have been paid, and he assumed that all cottages erected thereafter would not be subject to rates. I noticed that immediately there were
1898
signs of dissent on the Government Front Bench and no wonder. This one-sixth is to be one-sixth of the composite subject of valuation. Any increase in the number of cottages within the subject will increase the total value of the subject. New cottages will only add an increased value to the subject, but all will come under the rate. It will still be one-sixth of the whole, whatever that may be. It is fallacious to suggest that the one-sixth is a stabilised figure and does not allow for expansion with every increase in the capital value of the composite subject.

One of the greatest surprises which the Committee has had to-day has been the speech of the right hon. Gentleman the Member for Ross and Cromarty (Mr. Macpherson), who said it has been an old-established custom in Scotland to go in for valuation of the composite subject. That is new Liberalism to me. [Interruption.] I know it is tradition but Liberalism in Scotland has been constantly fighting tradition and, as far as I can remember, it has fought in Scotland to smash the system of the valuation of the composite subject. The policy adopted and recommended by a well-remembered Member of this House, the late Mr. Alexander Ure, was not the continuation of the system of the composite subject, but that there should be a separate valuation of the improvements as distinct from the land. It was not said, as my right hon. Friend seems to assume——

I know it is the law of the land and I am merely pointing out that, coming from the Liberal Benches, the right hon. Gentleman's speech seems to be a departure from the old progressive and radical point of view, which was that improvements effected on land, whether urban or agricultural, should be distinct in regard to valuation and should be treated separately. That was a cardinal feature of Liberal doctrine many years ago. Running through this discussion there are two principles which seem to have become involved. I am in favour of the Amendment because it carries out a principle which we will have to recognise. I put it to my right hon. Friend the Member for Ross and Cromarty, that if he takes
1899
this suggestion in relation to urban land, he will see at once that it will be in harmony with his own views that the valuations should be made clearly distinct as between the improvements and the land. There should be no more difficulty in applying the principle in agricultural than in urban areas. The Amendment has been well argued and it was interesting to notice that when the question of anomalies arose, the right hon. Gentleman admitted that anomalies would take place. It is no argument to say that although the Amendment may have justice behind it, there are sentimental and other reasons why we must go in for this fractional method even if we are forced into the confession that anomalies will arise from it. It is in order to get at the separation of the land value from the improvement value that I am in favour of the Amendment. It is not enough for the hon. Member for Perth and Kinross (Mr. Skelton) merely to say that he does not regard the one-sixth as a workable fraction. It is his place to prove what fraction is workable and I do not know of any.

The right hon. Gentleman the Secretary of State had two excuses for his proposal, one of which seemed to compromise the other. He said that one-sixth was better than one-fourth because it would encourage improvements; but almost in the next breath he said that, even in the cases where one-sixth would be too much, one-sixth should be inserted so as to compel agricultural owners to contribute their fair quota to the local rateable value of the area. I ask English Members to note that suggestion. I thought it quite a new feature with regard to Scotland. Even if the one-sixth is too much, the Secretary of State says he has the right to exact it on the ground that these people ought to contribute a certain amount to the local rates burden. That is a novel suggestion and is in marked distinction to anything so far advanced in regard to Scotland. Much that has been said about the discouragement of cottage building in agricultural areas is true. It is true that every improvement effected by housing and agricultural development has been penalised by increases in rates. But you will hot get over that difficulty by this one-sixth proposal. The difficulty goes deeper than
1900
that, and it will remain until there is a radical change, along Scottish lines and on the basis of segregating the improvements from the land.

The only way to encourage improvements is to de-rate improvements entirely. The man who has effected an improvement ought not to be called upon to pay even one-sixth. Abolish rates on improvements entirely. Of course, that is asking too much; but I suggest that, as this Bill now stands, the Amendment although it would not effect much in regard to the policy of the Bill, would have a significant effect upon future developments in Scotland. If this Amendment were incorporated in the Bill, it would be on all-fours with the demand which has gone up from Scotland for years, that a distinction should be made between the annual market value of improvements and the annual market value of the land. Therefore, I support the Amendment for reasons which differ perhaps from those advanced by other hon. Members. It may be that my reasons will be regarded as dangerous or subtle; but I think the reasons which I am advancing are consistent with those advanced by Commission after Commission appointed to consider this matter in relation to Scotland.

Before dealing with the speech of the hon. Member who has just sat down, I wish to call attention to the position as it is left by the speech of the Secretary of State for Scotland. The hon. Member for Northern Lanark (Sir A. Sprot), who introduced this Debate, referred to the speech of the Chancellor of the Exchequer when he first produced these proposals in this House. I could not help contrasting the glum, slow, halting, almost lachrymose way in which the hon. Member read out that quotation, with the "first, fine, careless rapture" with which the hon. Member and his colleagues greeted those words when they were spoken by the Chancellor of the Exchequer; and the Secretary of State himself, in his speech, provided a striking commentary on the distance which we have travelled since the day when the Chancellor of the Exchequer introduced his proposals. The Secretary of State for Scotland talked of it being no part of the Government's policy in relieving agriculture to deny that
1901
farmers should pay contributions to local services, and on that basis, he said, the Government were proceeding. There was very little about that basis in the speech of the Chancellor of the Exchequer on 24th April. He talked in a very different tone. He said:
The whole business of assessment and re-assessment, as far as he is concerned, comes to a final end. Out's out…. 'Stone dead hath no fellow.' "—[OFFICIAL REPORT, 24th April, 1928; col. 865, Vol. 216.]
Now the Secretary of State for Scotland comes and argues eloquently and cogently in favour of a certain measure of assessment, and says that agriculture ought to make its proper contribution to the cost of local burdens. We have travelled a very long way since the Chancellor introduced his Budget. There was nothing, moreover, in the Chancellor of the Exchequer's speech to indicate that, so far as farm servants' houses were concerned, they were to be an object of rating. After all, the Budget, the Chancellor told us, was to free all the implements of production, to free the stock and the buildings in which the stock was raised. Then why should the buildings which house the men who work the stock be rated? There again, it seems to me, we have travelled a long way since the Chancellor of the Exchequer introduced his proposals.

There are two reasons for not rating these farm servants' houses. There is the one to which I have referred and also the bad state of housing and the need to give every incentive to the proper development of housing in Scotland. I differ from the hon. Member for Burslem (Mr. MacLaren) on the practical point of the effect of the Amendment. On the whole, proceeding on the lines upon which the Government are proceeding, accepting the unsatisfactory foundation of that scheme, I am inclined to think that it would do more damage to the prospect of getting improved farm servants' houses if we passed this Amendment than if we did not; but I agree with the hon. Member that it is quite true that, if we proceed on these lines, inevitably, as houses are provided, they will go into the valuation roll, they will be valued, and rates will go up in respect of them. Therefore, unless it is perfectly clear, as it ought to be made clear, that farm servants' houses, the houses which house
1902
the men who work the farms, are to be taken out of the area of assessment, you will not be giving the full impetus which you might to the improvement of farm servants' houses in Scotland.

To what does the Chancellor's speech boil down? The right hon. Gentleman tells us definitely that they have abandoned the principle of de-rating houses and buildings and land. That principle has gone by the board. It is no longer there. The principle now is definitely that in future farmers are to be rated, instead of on one-quarter, on one-sixth; and, therefore, the amount of relief which they will receive by the measures produced by the Government will be one-quarter minus one-sixth, or one-twelfth. We were told by the Chancellor of the Exchequer in magniloquent phrases that all the burden of rates was swept off land and buildings, and it boils down to a vulgar fraction, to a relief amounting to one-twelfth. This is not carrying into effect the Government's declarations. It is an admission of failure. I suppose it is a financial failure. I suppose the money cannot be found, but, at any rate, it is an admission of failure. It is a retreat, and a retreat that is sounded only in the case of Scotland and not in the case of England.

I would like to refer to the position of the small landholders in Scotland. They are now free from rates on all their improvements. They are entered in the valuation roll at the fair rent which may exclude buildings altogether, and will exclude any proportion of the buildings on the farm which the landholder has provided for himself, that it to say, they pay rent only in respect of the buildings provided by the proprietor, and that proportion varies indefinitely. Let us take the simplest case, that of the man who owns all the buildings and who is, therefore, rated only on his land. There are three ways in which the Government might deal with this case. They might tear up all existing arrangements, destroy his existing rights, and merely value him on one-sixth of his land and buildings. I do not think the Government intend to do that, but I gave the Secretary of State for Scotland notice that I was going to ask this question, and if he will let me know the answer, I should like to know whether they intend to tear up his existing rights and rate him on the whole valuation as it is,
1903
on his house and buildings, or do they not? I hope they do not.

There are two other ways, and it seems to me, from the answer which the Secretary of State gave to my hon. Friend the Member for Orkney and Shetland (Sir E. Hamilton), that they are going to take this method. They are going to say that they will rate the crofter on one-sixth of the valuation of the land only. If they do that, they will be rating him in respect of his buildings on that one-sixth of his land. If it is still the policy of the Government to de-rate the land, they are rating that crofter on one-sixth in respect of his buildings, and that is exactly what, under existing legislation, he is exempt from. It may be, on the other hand, that the Government intend to sweep off all rates on the crofter and to say that that man is entitled to be exempt in respect of his buildings and in respect of his residence, to which the Chancellor of the Exchequer referred, and, therefore, they must not levy rates on him' at all. If that is so, that will indeed be satisfactory, but if, in the case of the man where the whole or practically the whole of his rent is in respect of his land, they intend to rate him on one-sixth of the entry in the valuation roll, there will be an obvious unfairness.

Take the case of two smallholders. Take A and B with exactly similar holdings and rents. In A's case the proprietor has put up all the buildings. A's capital, therefore, has remained free. He, of course, will have to pay merely in respect of one-sixth of his land and buildings. Now look at the case of B, who has sunk all his capital in his buildings. Perhaps he has borrowed his capital and paid interest on it. He has done it on the understanding that, according to Section 36 of the 1911 Act, he is exempt from rates. Therefore, if you come along and rate him on one-sixth of his value in the valuation roll, you will be treating him the same as A, who has not sunk his capital in his buildings, and who has never had that guarantee of exemption which B possesses under Section 36 of the 1911 Act.

Then there is the case of the smallholders settled after the War. They are settled on holdings, but the buildings have been obtained by bonds representing money borrowed from the Board. The
1904
entry in the valuation roll is in respect of the land alone. Therefore, there is no entry in respect of buildings. Those men have gone to great expense and had to buy at high prices, and it would be grossly unfair only to give them this very slight relief of one-twelfth in respect of their holdings. They are entered in the valuation roll in respect of land only. Their entry is not agricultural land in the valuation roll; it is No. So-and-So holding, and they ought to get complete relief in respect of the fact that the only entry in the valuation roll is an entry in respect of land and that there are no buildings in fact on which the Secretary of State has the right to decree that they should be assessed. It would be obviously wrong for the assessor to be asked to assume what is in fact untrue, and obviously untrue, that they have buildings in respect of which they ought to be assessed on one-sixth. As I was saying, these men have these rights which have been given them under the Act of 1911, Section 36, and that is why I differ from the hon. Member for Burslem.

The effect of this Amendment, if carried, would be that these men's houses would be valued. These men's houses, which by an Act of the Liberal party, of which he was a member, I think, in those days, were made exempt from improvements, were made exempt from rating, would, under the provisions of this Amendment, have to be valued, and that is one of the reasons why I cannot support it. The separate valuation would not work. The variations are too great. The variations in the case of each holding, the proportion which is owned by the proprietor and the proportion which is owned by the tenant; it may be anything from 1 per cent. to 99 per cent., it may be the whole or none, and that would make separate valuation in the case of the smallholders practically impossible. There would be exceptional cases in which the separate valuation of the houses would be as much as four-fifths of the whole subject and that is a great reason for not supporting this Amendment.

I know that the hon. Member does not wish that result brought about, but that would inevitably
1905
be the result if we passed this Amendment. Moreover, whenever the landlord made improvements, it would mean that the rates would go up, and, therefore, improvements would be penalised. For these various reasons, I cannot support the Amendment, but in supporting the attitude of the Secretary of State for Scotland on the Amendment, I would like to draw his attention to the actual terms of the Resolution, to which he referred, which was passed by the Scottish Chambers of Agriculture. It is quite true, as he said, that they passed a Resolution in favour of a fixed proportion of annual value, but the Resolution goes on:
subject to the proportion being made one-twelfth, or at all events not more than the proportion to be rated in England,
and that is a very important proviso. The Secretary of State for Scotland said that there must be some small anomalies, and that he was not going to be frightened by them, but if he goes on with his proportion of one-sixth, the anomalies will be gross and startling. The hon. Baronet, the Member for Forfar (Sir H. Hope), took the example of farms rented at £900. I will take a much lower figure, £600. According to the Secretary of State's figure, that would mean that the farmer's residence would be valued at £100. Most of the mansions in the country are not valued at £100. It would be three or four times the valuation of houses of a similar character and size in the towns. Anomalies like that could hardly be referred to in the complacent way in which the Secretary of State referred to them.

Then the right hon. Gentleman said that he wished the relief which is to be afforded by the methods which he proposed to be at least as large as the relief afforded by the English methods. Let me remind him of the rules adopted by the Central Valuation Committee under the Rating and Valuation Act, 1925. According to these rules, the farmer's residence is valued at 60 per cent. of one-eighth of the gross rent, which is equal to three-fortieths, or rather less than one-thirteenth. Therefore it seems to me that the Scottish Chamber of Agriculture, in putting forward the suggestion of one-twelfth, is making by no means an exaggerated demand. To be put on a level with England, we must
1906
get the proportion reduced to one-twelfth. That I think would be generally fair all over the country. Even then there would be anomalies. It would mean that some large farmers would be paying on a very high scale. The rents of 90 per cent. of the smallholders in Sutherland are under £5; under the Secretary of State's scheme they would pay on a maximum valuation of 16s. 8d., so that the total relief which they will receive is 3s. or 4s. a year, and the Secretary of State can afford to be generous to the smallholders if he can only rake in one big farmer and make him pay on a high valuation. However that may be, I agree that if you proceed on these lines, you must have a fixed proportion. That should not be more than one-twelfth. In the case of smallholders, who are, by Section 36 of the 1911 Act, exempt from the payment of rates in respect of houses, and in the ease of ex-service men, who have been settled by the Board of Agriculture, and who had to buy their improvements at high prices after the War, they should be exempt altogether from rates.

Mr. R. W. SMITH

I am rather in a difficulty after what the hon. Baronet has just said as to how to deal with the Amendment, because he seemed to think that by supporting it one was saying that the Government must value the houses separately. I am in favour of the percentage, but it seems to me that there is nothing to hinder the percentage being taken and entered in the valuation roll. The Amendment says:
in the case of agricultural land and heritages, the value of the house and cottages situated thereon shall be shown separately from the value of the agricultural land.
If they are shown separately, they can be valued according to a percentage, whatever the percentage may be, or they can be valued in subjects and just be entered in the valuation roll.

The Amendment says that the house and cottages shall be shown separately.

Mr. SMITH

The question is how are you to arrive at the value of the house which is to be shown on the valuation roll? Is it the percentage which is to be shown on the actual value as assessed by the assessor? Either of these things can be shown on the valuation roll. I am supporting this Amendment because it is
1907
fair. The real understanding which we got when the Chancellor of the Exchequer made his speech, and what we want in Scotland, was that agricultural land should be de-rated entirely. Now we have a totally different position, and land is to pay a part on a fraction. The point has been made that it is the duty of tenants of agricultural holdings to pay something towards local rates. In my constituency there are many cases of parcels of land valued from £3 to £4 up to £16, all of which are agricultural land, and are worked by people living in a house. These people are paying rates at the present time. If you are to be fair to them, you must take their houses as houses on the land, and rate them at one-sixth of the value of the land, as if these houses belonged to that land. We are told that we are going to de-rate land. Then let us do it and be fair about it. I am supporting this Amendment because agricultural land without any buildings in England is to be de-rated, and the Secretary of State for Scotland had said that he was concerned in giving for Scotland relief for agriculture equal to the relief granted in England. Scottish Members, if they are to do their duty, must see that the same relief is given to Scottish land as is given to English land. I should like to quote from the speech of the Secretary of State for Scotland which he made on 7th June:
The Government, therefore, propose to relieve the tenant of the rates which he at present pays upon the land, and to relieve the owner of part of the rates which he pays on his section, and put in a provision by which a half of the relief which the owner receives shall, during the existing tenancy, be passed on to the tenant. I should like hon. Members to realise that the tenant will be relieved of the burden of rates on the one-fourth which he is at present paying on the land, and that the owner will be relieved of the rates which he is paving on the three-quarters."—[OFFICIAL REPORT, 7th June, 1928; cols. 376–7. Vol. 218.]
That is a reasonable plan. I thought that agricultural land was to be de-rated, and the Chancellor of the Exchequer himself has admitted that agriculture is a productive industry. He said that as far as Scotland is concerned certain separate arrangements would be required where the incidence of rates and the general conditions differed from those of England. We knew that separate plans would be made for Scotland, but now we find that
1908
in the Scottish valuation rolls the houses are not to be separately valued. The Secretary of State said:
If we were now to adopt the same system as is followed in England, and proceed to value each individual farm and cottage throughout the whole of Scotland, it would be not only a lengthy but a difficult business, and would lead in some circumstances, particularly in the case of the smaller farms and holdings, possibly to an increase and not a decrease in the burden of rates on the individual.
He further said:
If I have made myself clear, therefore, we propose to deal with agricultural land by totally de-rating the land and leaving the rates upon houses and cottages to be levied on one-sixth of the gross rental."—[OFFICIAL REPORT, 7th June, 1928; cols. 377–8, Vol. 218.]
That is the case where there were houses on farms, and that will be a perfectly reasonable thing. I would appeal to the Secretary of State that it is only fair that we should receive the same treatment as England, and that land with no houses on it should be totally de-rated and that where there are houses they should be valued at a fraction. I do not say what the fraction should be. All I can contend is that land on which there are no houses should be de-rated. In the case of land on which there are no houses, it might be said that some time there will be houses, and that it will be reasonable when the houses come to rate one-sixth of the value. There is a question which I would like to put to the Secretary of State. Are we to assume that woodlands are to be de-rated entirely?

For the reasons I have given, I hope that the Secretary of State will see his way to accept this Amendment. The Amendment does not say that the valuation shall be the aggregate valuation. All it says is that it shall be shown. If we have the valuation shown on the valuation roll, we shall be able, when the other Bill comes on, to find the proper proportion.

It is interesting to find that the hon. Member for North Lanark (Sir A. Sprot) and the hon. Member for Forfar (Sir H. Hope) arrived by different roads at the same point as was reached by my hon. Friend the Member for Burslem (Mr. MacLaren), and they must now be watching their Amendments with great care, because they must realise that while all three arrived
1909
at the same point they did not reach it for the same reason, nor did they all intend to proceed from that point to the same goal. This is a question of getting a basis for the apportionment of a certain amount of relief, and I would like to give the Committee some figures which may fortify the hon. Member for North Lanark in supporting his contention, although not his Amendment. I will not give the Committee the whole of the figures, although I will hand them over to the Secretary of State for Scotland, but I have here an analysis of the effects of this particular Amendment, if the Amendment means, as I think it did mean, that both Scotland and England should be treated on the same basis, that is, that agricultural land should be totally exempt from rates, and only the houses rated.

Here is the case of a farm at a rental of just over £l,000. At present it pays on £270. Under the Secretary of State's arrangement it would pay on one-sixth, that is £180, so even there the farmer gets the advantage of £90; but if he were assessed on the English system, that is, paying no rates on anything except a house, he would pay on an assessment of £80 only, as against £180. I take it that is the meaning behind the Amendment of the hon. Member for North Lanark. The figure I have given includes the farmhouse and cottages. Farm B is rented at £1,320. At the moment the occupier pays on £330. Under the Secretary of State's scheme he would pay on £220; if the house and cottages were de-rated he would pay on £83. Take the case of the third farm, the rental of which is £600. At the moment that farmer pays on £150; under the new proposal he will pay on £100; but if the house and cottages only were assessed he would pay on £57.

I quote these figures because they are important as backing up the argument advanced from all parts of the House, whatever may be said on the merits of this Amendment, that there can be no question that the allowance of one-sixth does not approximate to the amount of relief in England. I will now give the Committee figures relating to one or two smaller farms. There is one with a total rental of about £420. The present rates are on £105. On a basis of one-sixth the amount would be £70, but if the basis of rating were the English basis the total rateable value would be £32. There is a wide margin between the figures under
1910
the scheme of the Secretary of State and the actual valuation of the farm cottages and the buildings. The reason why we cannot support the Amendment is this: We agree with the hon. and gallant Member for North Lanark that if agricultural land is to be relieved the Scottish farm tenant or occupying owner ought to have precisely the same relief, comparatively speaking, as his English colleagues. All will gain, of course, with the possible exception of the crofters. As the hon. and gallant Member for Caithness (Sir A. Sinclair) has said, there is some dubiety as to whether or not the one-sixth is going to apply to the buildings belonging to a crofter not now rated. Let us suppose it is not the intention now to rate those buildings. It is quite clear that the application of the one-sixth would bring clear gain all round, and the question is not whether it is going to be fair as between the large farmer, the small farmer and the crofter, but whether it will be fair in comparison with what their English colleagues are receiving. That is the point at issue.

As far as I can find out from figures given to me, I am inclined to think that 70 per cent. of the agriculturists north of the Border will gain on the one-sixth equally with their English colleagues, but the other 30 per cent. will undoubtedly be worse off, comparatively, than their English colleagues. I cannot give the rating authorities of Scotland the temptation to make separate assessments of houses and cottages, because that would be a direct temptation to them to rate them in future, but I do strongly press upon the Secretary of State for Scotland to consider the figures I have given, and those given by the hon. Member who moved the Amendment, not in support of a separate apportionment of houses and cottages, but in support of the overwhelming case in favour of treating Scottish farmers in the same way as agriculturists are treated beyond the Border.

I think hon. Members in all parts of the Committee are more or less agreed that even if we accept the factorial system we shall be in a position to give figures and arguments to my right hon. Friend the Secretary of State for Scotland which will prove conclusively that the figure of one-sixth is not sufficient. It is remarkable how various Members, though
1911
approaching this question from different angles, are, with the exception of the Mover and Seconder of the Amendment, all genuinely in favour of the factorial system. Some of the arguments used at the outset of his speech by the hon. and gallant Member for Caithness (Sir A. Sinclair) appeared to be an attack on the general proposals of the Government. As I have a Liberal candidate opposed to me at the election, I rejoiced, because if the Liberal party were really to commit themselves to opposition to this proposal I feel that my ammunition locker would be replenished. But though personally I should therefore have welcomed his opposition, I was glad, for the sake of the country, that as the speech developed, instead of opposing the proposal, he appeared to be, in the end, one of its warmest admirers. The hon. Member for Burslem (Mr. MacLaren) also advanced some objections, but these were based mainly, I think, on misconceptions, as was promptly pointed out to him by the hon. and gallant Member for Caithness. He talked about anomalies, but, after all, the biggest anomaly that this House has to face, is the fact that the hon. Member for Burslem should be sitting on the benches of the Opposition above the Gangway, for he is in no sense except in name united to them.

Regarding the general question, there is no doubt whatsoever that at the present moment there is a general feeling that Scotland has not got all that was promised in the original speeches made in this House on this subject. I think that feeling is wrong, and that it is largely due to a confusion of terms. In the speeches with which the proposal was first submitted to the House words were undoubtedly used stating that agricultural land was to be totally de-rated, and many in Scotland have got that firmly into their minds. In most cases it is undoubtedly true that agricultural land is being so de-rated, but there are exceptions, especially where a parcel of land has no house on it; that is not, of course, being totally de-rated, according to what my right hon. Friend has said. In the main, however, it is perfectly correct to say that agricultural land is being derated by the proposals of the Government under the factorial system, and in any case it is obvious that even if the
1912
present factor is not sufficient, you can get some factor which will entirely de-rate agricultural land when applied to the whole subject. It is only a question of arranging what the factor should be, so that all agricultural land, with the solitary exception of parcels of land on which there are no houses, or woodlands on which there are no houses, shall be entirely de-rated. A factor so great as to de-rate all our agricultural land may, of course, be such as it would be beyond the means of the Treasury to meet, and we are bound to face the fact that there must be anomalies; especially there is the case of large farms which, while they will benefit, will not benefit proportionately to the same extent as small farms. That I do not regard with any great regret because I personally welcome the fact that if there must be inequality the scales are to be definitely weighed down in favour of the small farmer, and I go farther; I do not think the large farmers themselves will object to this bias.

I have talked with a number of large farmers since this proposal was introduced and, in common with other Scottish Members, I have received a good deal of correspondence from large farmers and other people pointing out objections. They have pointed out that they were not going to get the full benefit of the proposals, measured either in the terms of the benefits which England is going to get or in terms of the benefit which the small farmer was going to get; but as time has gone on almost all their objections have disappeared, and, I say it to their credit, the large farmers have definitely stated that they will not object to receiving rather less than their smaller colleagues in the agricultural industry, provided that they are convinced that the industry as a whole in Scotland is going to receive as much as the industry in England. I think it is the business of Scottish Members of all parties to see that Scotland does get at least as full a measure of assistance from the Government, in proportion to its size, as does England. I am certain that any proposal of that sort, if it be backed up with figures, and not with assertions only, will receive the general sympathy of my right hon. Friends, and, I am encouraged to hope, the assent of the Chancellor of the Exchequer. What we Scottish Members have to do at the moment is to endeavour to give figures
1913
which will enable my right hon. Friend to arrive at the appropriate factor. The hon. Member for Leith (Mr. E. Brown) gave some very valuable figures which, although they did not surprise anyone who had gone into the subject, will, I think, be of great value to my right hon. Friend and to the Scottish Office in arriving at the appropriate factor to apply to the industry in Scotland.

I would like to say a word about a proposal which was made by the hon. Member for Central Aberdeen (Mr. R. W. Smith) on the subject of the rolls. He appeared to wish that certain values of farmhouses and cottages should be put in the valuation roll even though they were not really the assessed values but only the values arrived at as the result of a factorial assessment. This would only give the result of a fairly simple mathematical calculation—by dividing the total subject by six and showing what was one-sixth and what was five-sixths. I cannot think that is sufficient reason for supporting the Amendment. I will finish by making an appeal to the hon. Member who moved the Amendment and the hon. Member who seconded it to withdraw it. I think the Committee generally is agreed that the factorial system is not only the best but the only practical system. It can serve no useful purpose, either in this House or out of it, to leave on the Paper or to carry to a Division, or even to allow to be negatived without a Division an Amendment of this nature. As seen by the country, the Amendment can have only one of two results. The big farmers may say: "Here are certain Members fighting our case for us," or, on the other hand, small farmers may say: "Here are Members who are fighting against our own particular interests." Is that desirable? From a national point of view, surely it is far better that the House as a whole, having now considered this problem for the best part of a Parliamentary day, and having arrived at almost universal agreement that the factorial system is the best system, and that, properly applied, it can produce something so near complete justice as to satisfy even the demands of Scottish Members—and that is saying a good deal—should be united in recommending that system to
1914
Scotland. If my hon. Friends withdraw the Amendment, Scotland will know that we in this House are doing our best for her interests, and we can then proceed to the far more important problem of deciding the factor to be applied.

The hon. and gallant Member for Caithness (Sir A. Sinclair) has raised the question of the treatment of the crofters. As I understand the position, we shall not, under these proposals, take away from the crofters any of the rights which they enjoy at the present time. The crofter will merely pay one-sixth upon the gross rental which is entered or may be entered from time to time in the valuation roll. I think that on reconsideration the hon. and gallant Member will agree that, as in the rest of the country—in the great Highland districts there is an increasing body of crofters and there may be a still bigger increase in the future—it is unreasonable that these people holding under these terms, while safeguarded and given certain benefits which the State has said that they should have from time to time, should not pay in some small measure towards those local services which are of increasing benefit to them and their families. I think, in these circumstances, we may take it that there will be no unfairness to them.

The hon. Member for Central Aberdeen (Mr. E. W. Smith) raised the subject of lands on which there are no houses. I appreciate that point of view and the difficulty which it raises, but, as I have already said, in my judgment it is so small in proportion to the other advantages which are going to be gained under this Clause, that it is just and reasonable that those who hold the ground without buildings upon it should pay their contribution. There is also the question of the woodlands. As I understand it, the woodlands are separately entered and shown in the valuation roll to-day. As that differentiation is made now, it leaves it open in the case of any future Bill for the adoption of any methods which hon. Members may advise the Government are suitable in dealing with that subject. I am grateful to hon. Members for the way in which they have treated this subject. We have had a very valuable discussion which will help to clear our minds, and I hope the hon.
1915
Member who moved this Amendment will withdraw it.

My right hon. Friend has just told us that woodlands are shown definitely in the valuation roll. That is quite true, and therefore it is open in some future Bill for the Government to cause woodlands to be rated in Scotland when they are not being rated in England. All I can say about that is that I do not think it is going to be done. I am here to stick up for the rights of Scotland, and to see that she gets her just demands as compared with England. With regard to what fell from the hon. Member for Dundee (Mr. Johnston) about the improvement of farm labourers' cottages, I think that no man has that question more at heart than I have, and many of us have not only been talking on this subject, but we have done something in that direction in our own particular spheres. I do not believe that what the hon. Member put forward is an argument which has the slightest validity. The hon. Member for Dundee said that if you fix the rating on a farm at one-sixth, if you build a fine, new house upon that farm the rates will not go up and the rating will not be increased, but if you add it on the value of the building then the landowner will be deterred from building new houses. Farm labourers' cottages are valued in the Scottish valuation roll at about £4 a year and an extra good cottage may be valued at £6 a year. If you build a particularly swagger cottage it might be valued at £10, but is anybody going to tell me that any proprietor having some £500 or £600 to spare for the erection of a fine new cottage, and having made up his mind that he wants to engage an extra man, will be deterred from building that cottage by the consideration that his rates will go up by a few shillings for two, three or four years? That is absurd, and I do not think a consideration of that kind would enter into the matter at all.

Some time ago we appointed a Costings Commission, and they brought out the cost of an extra ploughman and two horses on a farm. Take, for example, a case where a man employed six ploughmen, and he wanted to employ seven and work an extra pair of horses. The cost
1916
of engaging an extra man and running an extra pair of horses would be something like £500, but the cost in the rates on the cottage would be something quite negligible. The Secretary of State for Scotland promised to go into this question still further, and he said he would like to have the figures. I have some figures from a reliable source. The hon. Member for Leith (Mr. E. Brown) has given figures relating to a large farm of £800 a year. Let me give to the Committee the figure of £100 a year of a holding with one house upon it and no cottages. In this case the occupier is paying £6 5s. in rates. Under the English system he would have to pay only £l 17s. 6d., and he would be a very great gainer under the system which I propose. Under my right hon. Friend's proposal of one-sixth, this same occupier would have to pay £4 3s. 4d., and if the fraction were one-eighth, his rates would amount to £3 2s. 6d. So even if you take the fraction of one-eighth you do not get anything like the English system.

I think that I have established my original proposition that Scotland is not being treated fairly in this matter. We are told that agricultural land is going to be de-rated. It seems to me that it will be de-rated in England, but apparently not in Scotland. The proof of that is that land upon which no houses have been built will still have to pay rates in Scotland, and that will not be the case in England. With regard to woodlands, the right hon. Gentleman did not make any pronouncement. Surely it is not proposed that woodlands in Scotland should pay rates while in England they will not be rated. In case my proposals are put into force, it would be necessary to have all these entries in the valuation roll. If they are not put in, and if my Amendment is not accepted, then the proposal which I have adumbrated will fall to the ground. Therefore, I shall ask the Committee to take the responsibility of negativing this proposal. I shall not press it to a division, and I shall not withdraw it.

The next two Amendments on the Paper have been covered by the discussion on the last Amendment:

In page 9, line 26, at end, insert the words:
grass parks and agricultural land on which there is no house to be valued separately."—[Sir A. Sprot.]
In page 9, line 26, at end, insert the words:
and, in the case of agricultural lands and heritages on which there are no houses, the valuation roll shall show by some distinguishing mark which of these lands and heritages are of less than four acres in extent."—[Mr. B. W. Smith.]

The next Amendment in the name of the right hon. Member for West Fife (Mr. W. Adamson)—in page 9, line 35, at end, insert the words:
shall be granted the relief provided for in this Act, as from the first day of October, nineteen hundred and twenty-eight"—
is foreign to the Bill. The Amendment standing in the name of the hon. Member for Leith (Mr. E. Brown)—in page 9, line 40, to leave out the word "whose," and to insert instead thereof the word "where"—is merely to correct something which has already been corrected.

I do not know whether it is a mistake in drafting, but the word "whose" appears, not only in my copy of the Bill, but in that of those who were concerned with me in discussing the dock and transport arrangements.

On a point of Order. May I ask whether, once a Bill is printed, anyone, without an Amendment made by the House, has the right to alter it? If
1918
that be so, it seems to be a very serious departure. I do not mean that it is so in this case, but it might be very serious. As I have said, in my own copy of the Bill the word is "whose," and that word also appeared in the copy used by the Dock Commission when the Bill was discussed some three weeks ago.

I have the pleasure of telling the hon. Member that he is right. I see that in the official copy of the Bill the word "whose" still appears, and, therefore, I will call upon the hon. Member to move his Amendment.

It is a matter of principle affecting the House if the officials, or anyone else, can alter words without authority, and, if anything of the kind were allowed to be done, it might on some other occasion seriously affect the procedure.

I beg to move, in page 10, line 43, at the end, to insert the words:
or to any valuation roll for any year subsequent to the year beginning the sixteenth day of May, nineteen hundred and twenty-nine.
The intention, both in England and in Scotland, is that the Inland Revenue shall concern itself with the valuation only in the first year, and this Amendment is required in order to give effect to that.

I beg to move, in page 11, line 9, at the end, to insert the words:
(11) Minerals which are being worked shall for the purposes of this Act be deemed to be lands and heritages occupied and used as a mine.1919
In Scotland the word "minerals" is commonly used to describe a mine, and the assessors in Scotland think that this may possibly give rise to some difficulty. This Amendment makes it quite clear that minerals where they are being worked are to be included in the definition of a mine, so that there should now be no difficulty at all in this respect.

I beg to move, as an Amendment to the proposed Amendment, in line 1, after the word "shall," to insert the word "not."

This Amendment of the Solicitor-General's raises very large issues, and the hon. and learned Gentleman must not be allowed to smuggle it through the Committee. My Amendment to the proposed Amendment seeks to prevent the mineral royalty owner from receiving any relief at all from public money. There is a very large public opinion which does not believe that the mineral royalty owner should be compensated in any way out of public funds, and there is a very large public opinion which holds very keenly that the mineral royalty owner should be given a time limit to clear out before the State sends the policeman after him. By this Bill, however, the mineral royalty owner is to receive public money by way of rate relief, under the pretext that this is going to assist and facilitate industry. In the Glasgow City area these mineral royalty owners are already allowed deductions of 47½ per cent. A mineral royalty owner whose annual income from mineral royalties is £1,000 is at present only rated upon £525. Under the proposal of the Government he is only to be rated on £250. In the case of the mineral royalty owner, the man who sleeps but thrives, the man who has sunk no capital, who contributes nothing whatever to the success of the coalmining industry, who is a slug and a parasite, we are actually asked to reduce his rating subject from £1,000 to £250, at a time when the collier's house is not to receive a penny of reduction, when the poor tenant is not to receive a penny of reduction, when the shopkeeper is not to receive a penny of reduction, when the public utility service is not to receive a penny of reduction. Parliamentary words almost fail me to describe what I think of the proposal to
1920
reduce the local rating upon the mineral royalty owner.

It is perfectly true that in Scotland as a whole the average reduction is not 47½ per cent. at present, but 5 per cent. Nevertheless, under the proposals of the Government, the mineral royalty owner is to get a reduction of 75 per cent., and, therefore, all the £1,000 men are only to be rated on £250. There is this difference between England and Scotland, that it is highly questionable whether the man who calls himself a mineral royalty owner has any legal title at all to take a penny. I am not arguing about England at all, but in Scotland an Act, which I have here, was passed in the old Scottish Parliament, an Act of James VI, passed in 1592, not a line of which, as was admitted by the Lord Advocate in cross-examination before the Coal Industry Commission, has been repealed. By that Act it was declared:
That the right of all mines pertains to His Majesty and His Highness's predecessor.

I am expressing no opinion as to whether or not he is being resurrected; I am stating an historical fact, namely, that, by the Act of 1592, it was declared to be the law of Scotland that all mines and all metals were the property of the Crown, and could only be worked on a Crown lease, the lessee fining to the Crown an annual sum. That Act has never been repealed, and, in cross-examination before the Coal Industry Commission, it was admitted that the right to mine for coal was held directly from the Crown. You find feu charters granted in 1618 by King James giving the right to mine for coal on condition that one-tenth of all the value raised was handed back to the Crown. That has continued, certainly implicitly——

We cannot now embark on a discussion of the whole subject of Scottish law. It seems to me that, if the hon. Member's contention be right, no rates at all ought to be paid on these minerals, because they belong to the Crown, and the Crown only pays rates, in England at any rate, by its own bounty.

With great deference, I am submitting here that, if this proposal of the Government is to be put into an Act of Parliament now, and if it is to be for the first time declared by Act of Parliament to be legal, then, although we are taking something from the owners of minerals, we are giving them rights which have never hitherto been legally admitted. I am submitting that, if we allow this opportunity to pass without protest, we are admitting that the old Act of 1592 has been scrapped, and we do not propose to admit that that is so. I certainly do not wish to prolong the discussion on this point, but I should like to say that as late as 1842, or certainly as late as 1840, the Lord Advocate of that day was prosecuting alleged royalty owners for taking these royalties. The Lord Advocate of the day issued warrants declaring that these royalties were the property of the Crown and ought not to be privately appropriated at all, and we come across some very dexterous manipulations in another place to prevent actual prosecutions, resulting in fines, or, it might be, imprisonment.

Now, for the first time, we have a Government bringing in legislation whereby this old Act of 1592, which declared the Crown to be the sole owner of all mines and metals found in Scotland, is being silently abrogated, so that henceforth the crimes of the mineral royalty owners, who have taken their illicit moneys for all these years, who have defrauded the State and the revenues of the Crown, are to be commuted on condition that they pay a small fraction to the State, and this small fraction of their plunder is to be relieved of rates to the extent of 75 per cent. Will the right hon. Gentleman tell as what in Heaven's name is the purpose in production fulfilled by the mineral royalty owner? Does he assist industry in any way? Where and how does he help the productivity of the country? He does not do so a bit, because he is a slug on the business, a sucker, and now, when we are getting back from him a small amount in local rates, the present Government steps in and relieves him to the extent of three-fourths of that sum. I move this Amendment so that, in Scotland at any rate, the mineral royalty owner may not be relieved of any proportion of his local rates.

I very remarkable point arises in connection with the omission of this word from the drafting. When I put a question to the right hon. Gentleman as to the amount of relief to be given to mines and minerals, I based it on the memorandum issued by the Scottish Office in connection with the valuation of 1926, and there the definition was mines and minerals. The answer to the question was that nearly £400,000 was the estimated total of rates paid by mines and minerals. I now hold in my hand the latest paper, which I have got at last, dealing with the yield of properties, and I find the basis there is very different. Instead of having the figures of the estimated rates on the various properties, and the figures for mines and minerals, just as this word "minerals" has been left out from this draft, so it has been left out and another word inserted, and we have here the amount for the burghs of Scotland for mines and quarries—not minerals—some £33,000 and £330,000 for the landward area, making a total of £360,000. Is this new classification in the White Paper, as compared with the earlier one, the result of dropping the word "minerals" from the definition and a desire to keep from the House the knowledge of how much of this 75 per cent. of relief is actually to go to the productive part of the mine and how much to the rateable value of the minerals? It seems very strange that in two successive White Papers we should have had, first the answer given on the basis of mines and minerals, and then on mines and quarries. Certainly, I agree with the hon. Member for Dundee (Mr. Johnston) that since the word "minerals" has been left out it should be a thoroughly good precedent for England and we ought to omit the rating relief for the minerals and give it to the productive part of the industry, the mines. Since the draftsman has left it out, the Committee will be wise if it continues to leave it out.

People who have been reading about the Bill have been led to believe that what is being done by it is to help industry. The Secretary of State has been challenged by my hon. Friend the Member for Dundee (Mr. Johnston) to define what contribution the royalty owner makes to industry.
1923
From practical experience, I know what it means, after you have worked 10 hours, as I did, to realise that when you have finished your day's work there is a royalty owner somewhere, who never saw the mine and never knew the coal was there until a scientist pointed it out to him, and yet we are now being told that to help industry we have further to subsidise a blood-sucker who sucks the blood of industry. I cannot understand what is meant by this royalty. I think the reason it was called a royalty was to associate it with all that royalty means. A royalty on minerals means that when an industrialist, through his activity, supplies the needs of the people, we have this useless blood-sucker called a mineral owner, and then a royalty owner, saying that before the nation can have the use of God's materials to make the things they need to live by, you have to allow him to suck your blood. It is not a small thing. Seventy-five is being arranged for now by the under suckers of the blood-sucker, because, in legal phraseology, we know what aiding and abetting means, especially if you are in the witness box. The Secretary of State always shunts a plain straightforward question like that. I have often wondered whether it is that he cannot answer or that he will not. If he is intimate with history, especially Scottish history, he will realise that there is no basis in law for a royalty being paid in Scotland. I challenge him, or the Solicitor-General, to show where a royalty was ever made legal.

What I am pointing out is that there is no right. We are trying to rectify a wrong. On what ground can the Secretary of State bring forward this relief? It is not a relief to the man who is getting the minerals, or a condition that must obtain before the royalty-owner can get the relief. It does not increase the purchasing power of the miner. The miners in Scotland are being crushed down to the lowest standard of living, and their children three times a day have bread and margarine, or bread and
1924
dripping, and you give 75 per cent. to the blood-suckers living in their big houses, waiting on the miners' blood-money, because that is what it comes to in the end. I am ashamed to think there are royalty-owners in this House who do not get up and say: "I will have none of your filthy money." You have these gentlemen preaching about morals and going to church on Sundays, but putting their hands right down for the further 75 per cent. They know the state of the mining industry, and they know the state of poverty of these people. We have all that lingers in this thing called "royalty," from the top of the rotten tree right down to its rotten roots—these suckers. I hope before this goes to a vote we shall have answers to the questions I have put. I hope we are going to have some statement to show upon what grounds, legal or otherwise, the Government is going to put forward a relief of 75 per cent. to the most obvious robbery.

A surprising feature of this discussion is the simplicity with which the Solicitor-General introduced the subject. He comes to that Box in the most innocent fashion like a mere novice as to the political and legal aspects of the situation, and asks us surreptitiously to accept this proposal. However bland he may be, we are at least not blind to the implications of this proposal. The very least we are entitled to expect from him is some explanation of the effect of these proposals, not only as regards the ultimate disposal of the monies intended to be devoted to relief purposes but also as to its effect upon various individuals concerned. We are entitled to expect some clear lead from the Solicitor-General as to the legality of such a proposal. Clearly, before he can ask us to accept it, he must prove that those who are to be the recipients of the relief are entitled to the property, the rates on which are to be relieved.

On a point of Order. If the point you raise now is a point of substance, surely the Government's
1925
Amendment must fail? If the royalty owner has no right to relief, the Government's Amendment cannot be debated.

I should be very sorry indeed to give any ruling upon English law, much less upon Scottish. Of course, if the contention is correct, and only the Crown has a right to the minerals, and people are getting an illegal income, obviously that could be tested in the Courts, and they could be deprived of it. But if they were deprived of it, they could not pay rates on it. I think we must assume for the purposes of the argument that they can legally—whether morally or not I do not determine—receive royalties and be rated on them. How far they can be relieved from rates is now the point.

You, Sir, have stated one part of the case accurately. The position of the Government, as I understand it, is that they assume the legality of this proposal. I am much more concerned about the wisdom of the further proposal to relieve these illegal mineral and royalty owners of their rates, and I want to put one or two points to the Solicitor-General. How much of this relief is to be devoted to mines and how much to minerals? And will there follow any reduction in the royalties now charged on the production of coal? If it is intended to devote this money to the relief of industry, surely it must be proved that the mineral owner, as a result of participating in the reduction of rates, will pass it on to the mineowner, and then to industry, so that industry itself can be relieved. We are entitled to some clarity from the Solicitor-General on these matters. I also want to put a further point to him. I would like to hear from him how we are to distinguish in respect of the relief provisions as between the royalty owner qua royalty owner, and the royalty owner who is also the owner of the mine. As is well known, mining undertakings have taken possession of royalties and, as far as I can see, there is no clear line of demarcation. I cannot understand, apart from the morality of this issue, why the Solicitor-General should ask us to accept this proposal in this way. We are entitled to have these points clearly elucidated, and I support my hon.
1926
Friend in his demand that, before this proposal passes through Committee, the Solicitor-General, on behalf of the Government, should not only give us the reasons why this proposal is being put forward, but also clear our minds of these perplexities and intricacies which make it impossible to judge as to the wisdom of the issue.

The question is as to whether mines are to be relieved of rates. It is not a question of royalty at all. Sub-section (3) of Clause 3 says:
'Mine' has the meaning assigned to it by Section one hundred and twenty-two of the Coal Mines Act, 1911, or Section forty-one of the Metalliferous Mines Regulation Act, 1872.
The result is that practically every possible mine is included. The purpose of Clause 3 is to relieve industrial hereditaments, or industrial lands and heritages, and the three which have been relieved are mines, factories and workshops. The suggestion from the other side is that they do not wish mines to be included. [HON. MEMBERS: "No!"] I gather that they are with me so far that they want mines to be relieved. In Scotland the law is different from England. You have got the owner and tenant. The rates are assessable on both owner and tenant in Scotland. As regards collieries, those who work them are the tenants of the mines. The suggestion is that they are to get no relief. We say they are to get relief. They pay rent, either a fixed rent or a rent fixed by royalty. That is the rent they pay, and that will probably be more or less the valuation of this particular subject. The owners are assessed at substantially one-half and the tenants at one-half.

As regards lands and heritages in Scotland there must be an owner. If he occupies it himself, there is no tenant, but, if there is a tenant, you have the two classes, the owner and the tenant, and they each pay half. The whole point of the Amendment is this. There is a provision in Scotland that mines and quarries are not to be asssessed or valued if they are not worked. In some cases in Scotland people who have not worked the mine
1927
may in some cases have to pay a fixed rent. If that was left under the word "mine" or "quarry" they would not be able to be assessed. In Scotland, in fact, the assessors have always entered mines or quarries under the word "minerals." I am not sure about quarries, but they have certainly entered mines under that heading. They have not entered "mines" at all, and you will not find "mines" at all in the valuation rolls in Scotland. If the assessors are right in their view, though there is some doubt about it, they wish to make it clear that the word "minerals," which they have been using, is the same thing as the word "mines," so that there may be no doubt about its meaning. They have a doubt about the matter, and they merely wish the meaning to be made clear. If the assessors are right and they require the word "mineral" to go in, then, if you have not the word "mineral" in you are defeating the whole purpose of this Measure with regard to the relief of mines in Scotland. I am sure that is not the wish of the Members on the other side. There is no question in this Bill of royalties or royalty owners. They are landlords, and, undoubtedly, Members opposite do not like landlords. The owners of the minerals are landlords, and they are getting rent, and it is true that they are to be relieved to the extent of 75 per cent. of what they now pay. But they are to hand back that relief, as I understand, to the tenants.

It is not in this Bill, because this is a Valuation Bill. We were told by the Minister that there is to be a provision that the landlord shall pass back the whole of the relief, as regards industrial hereditaments, and that as regards agriculture he is to pass back one-half of the relief which he gets.

There is nothing sinister about this particular Amendment. The assessors have said, "We have always been in the habit of putting mines into a valuation roll under the heading
1928
'Minerals,' and therefore we want to be quite clear that mines are included in this Bill." According to the Amendment, only minerals that are being worked are to be included, and minerals that are being worked are the same thing as mines that are being worked. I have said that I do not think the words are necessary, but the feeling in Scotland among these skilled men is that it is desirable that they should go in. There is no other reason why they should go in.

The hon. and learned Gentleman has just stated that the assessors in Scotland when they are doing their duty look at it from two points, both on the rental basis. You have the superior landlord and the tenant. If that statement be true, will the hon. and learned Gentleman now tell the Committee if there is a single case where the right to work minerals in Scotland is not granted from an overlord of minerals by the ton? Can he give us a case of such an annual rent for working minerals without a specific sum per ton? Can he give a specific illustration?

It may not be a fair way of fixing rent. As I understand it, a fixed rent is very often specified, but, if the royalty per ton exceeded a fixed rent, then they get royalties. That royalty is paid to the owner of the minerals. He is the landlord and those who are working them are the tenants. This Bill is designed to give the mining industry relief, and the mining industry is going to get relief in the form of a rebate of three-quarters of the rates and, as in Scotland these are paid half by the owner and half by the tenant, it inevitably follows that the relief is given to both. Otherwise you would not be giving the same relief in Scotland as in England.

Will the hon. and learned Gentleman give us a specific pledge that every penny of rating relief which goes to the mineral royalty owner or landowner who owns the mine shall be returned to the colliery company or the individual who works the colliery?

I cannot give any pledge at all. The House will require to decide on the question when it comes up. I think the Minister said that as far as existing leases are concerned, the whole of the royalty given to the landlord would be handed over to the tenants. I am speaking subject to correction, but I understood that that was what he said.

May I ask the Secretary of State for Scotland, as this is a question of high policy which ought not to depend upon what some junior Minister understands some other Minister said on another occasion, whether he will give us a specific pledge that the royalty owner and the owner of the land in which these minerals are is not going to benefit by a penny piece of the reduction, but that every penny of such reduction is to be handed back to the company or individual working the minerals?

I thought that when I spoke before I made it clear that, as far as industrial subjects are concerned, factories, mines and quarries, in so far as it happens in Scotland that you have a divided payment of rates, the owner and the occupier, it was the intention of the Government to make provision, during the existing leases, tenancies and agreements, that the whole of the rate relief should be passed on to the occupier for the time being. I stated that on behalf of the Government and I adhere to it. Of course that will come up on the Bill in the autumn, and it will be for the House to decide.

I have been listening to the duel between the Solicitor-General for Scotland, the Secretary of State for Scotland and the hon. Member for Dundee (Mr. Johnston). It is rather a triangular duel, like the one of which we read in "Peter Simple." In this case two of the duellists have been evading replying. Neither the Solicitor-General nor the Secretary of State for Scotland has faced the right issue put up by the hon. Member for Dundee. They have dodged the question as to who is going to get the relief. They have not made any reference whatever to the evidence produced by the hon. Member for Dundee and read to this Committee with regard to the ownership of royalties in Scotland. As to those who are to receive relief in Scotland when the existing leases have become non-existent, the whole issue resolves itself, so far as this particular Section and the Amendment are concerned, into who is the owner of the mineral royalties of Scotland, and, therefore, who is the individual or who are the individuals to whom this particular relief is to be granted? The replies of the Secretary of State for Scotland and the Solicitor-General for Scotland do not meet the issue at all. The whole issue has been avoided just as questions which have been asked across the Floor of this House since 1919 by myself and by other Members.

This does not arise under this Bill. The whole question is the apportionment of the hereditaments and the apportionment of rates and the relief of rates accordingly. The question of the ownership may be settled afterwards by the Courts, but that does not arise on this Amendment.

That might be the issue in the Courts, but the issue would be made much simpler for us if we could understand exactly who is going to get the relief. If the relief is going to go back to the Crown, all well and good. If it is going into the pockets, even at the end of the leases that are in existence at the present time, of those who to-day are taking the royalties, then it is a very different matter, and one with regard to which we protest most strongly. We have all along pointed out that the
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individuals who to-day are taking the royalties and who will expect this relief when it is granted by the Government are not entitled to them. A point has been raised this afternoon on the old Act of Parliament of 1592, an extract from which was read. The Solicitor-General shakes his head. Why did he not deal with it when he was on his feet if the point was wrong? Why did he not take up that issue?

I do not see how he could. This is a question of law. Neither the Solicitor-General nor the Secretary of State for Scotland can determine the law, and even Solicitors-General are sometimes wrong.

Mr. L'ESTRANGE MALONE

On a point of Order. May I ask whether you, Mr. Chairman, will accept a Motion for the Closure now in view of the fact that less than 15 minutes remain in which to discuss very important Amendments. The Scottish Members have had adequate consideration, and I submit that the English Members should have the last quarter of an hour to discuss more urgent Amendments on the Paper?

I fear the Closure and consequent Division would exhaust all the available time. I must ask the hon. Member for Govan (Mr. Maclean) not to deal with this question of law, but to deal with the effect of the wording of the Bill.

We have been trying to get a reply from the hon. and learned Gentleman opposite on the points put to him by the Member for Dundee (Mr. Johnston), but we have not received an adequate reply yet. I object to this relief being granted to the royalty takers in Scotland. We have been told that the mining industry is in a terrible state. The miners themselves are being compelled by law to work one hour extra per day, in order, as we were told, to save the mining industry from ruin. The Secretary of State for Scotland now brings forward an Amendment proposing to give relief to the royalty takers of that industry. He says that the relief is going to be given direct, while the present leases are in existence, to those who are working the coal—the colliery companies. He also says that at the end
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of that period—in some cases it may be next year, and in other cases it may be two years hence—a new bargain will have to be struck. Knowing the Government as we know this Government, I hope that they will not be in office—and this sentiment finds an echo in every part of the country—when a new bargain is struck, but that there will be in power some other Government who will consider the fact that the miner, who is being compelled to work longer hours, is the individual who should be relieved, and not the royalty taker. When relief is granted, it should go directly back to the producers in the industry and not to parasites in the industry as are the royalty takers. The proposal before the Committee is only another instance of this Government's love for their own friends. It is another instance of how they are going to treat the property owners—the profit takers—as compared with their treatment of those who are doing the really useful and productive work of the country.

The Secretary of State and the Solicitor-General for Scotland are proving themselves worthy abetters of the Government in seeing to it that those who have plenty in the country are going to have more, and that those who have very little in the country are going to get less. As far as the Amendment of the Secretary of State for Scotland is concerned, it will result in more being given to the royalty takers. It will not relieve the mining industry and more than putting an additional hour on the miners' working day has relieved the industry, or made it more possible for the industry to survive the collapse brought about through the legislation of the present Government. The methods which the Government are adopting in this Bill will not save the mining industry. Talk about this relief being handed back by the royalty takers to the mine-owners! Can you imagine anything being handed back by the royalty takers once they have laid their hands upon it? We have had no proof given to us that this can be accomplished. The Secretary of State for Scotland says that in some future Bill some points will be inserted to ensure that these reliefs are given back to the industry. The Solicitor-General for Scotland put forward the same idea.

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One would have imagined that in having this particular rating proposal brought before the House, the succeeding scheme, namely, the distribution of the sums that are going to be collected and dispersed in relief, would already have been thought out and arranged by the Government. The Bill which has been hinted at as following the present Bill ought already to have been framed, yet when questions have been put to hon. and right hon. Gentlemen on the Government side we have not been, given any information of a definite and specific character. As far as I am concerned, and I think I can say that as far as a large number of other Members are concerned, this Amendment will be pressed to a Division. Why cannot the Solicitor

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General for Scotland give us the definite proposal which the Government intend to incorporate in the succeeding Bill? Why cannot he come forward with a definite and specific proposal? It must have been thought out by this time. Neither he nor the Secretary of State for Scotland has given any indication as to how far it is proposed to go, and, therefore, I hope my hon. Friend will press this matter to a Division, and not withdraw his Amendment as did the satellite of the Government the last Amendment.

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Question put, "That the word 'not' be there inserted in the proposed Amendment."

§The Chairman then proceeded successively to put forthwith the Questions tions on any Amendments moved by the Government of which notice had been given, and the Questions necessary to bring the Committee stage to a conclusion.

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Amendment proposed: In page 11, line 18, at the end, to add the words:

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(12) The assessor shall be entitled at any reasonable time of day, on giving not lees than twenty-four hours previous notice in
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writing to the occupier, to enter, survey, and value for the purposes of the Lands Valuation (Scotland) Act, 1854, and the Acts amending that Act, including this Act, any lands and heritages within the county or burgh or district for which he acts as assessor, and if any person refuses to admit the assessor to enter any lands and heritages or obstructs him in making his survey or valuation he shall be liable on conviction by a court of summary jurisdiction to a penalty not exceeding twenty pounds:

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(13) As respects the valuation of lands and heritages for the year beginning on
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the sixteenth day of May, nineteen hundred and twenty-nine, the following provisions shall have effect:—

(a) Any officer or person employed by the Commissioners of Inland Revenue and authorised by them for the purpose shall for the purpose of carrying out his powers and duties under this Act have the like rights as the assessor to enter, survey, and value any lands and heritages to which he has reason to believe the provision of this Act may apply, and any person refusing to admit such officer or person or obstructing him in making his survey or valuation shall be liable on conviction by a court of summary jurisdiction to a penalty not exceeding twenty pounds;

(b) The Secretary of State may make Regulations requiring the assessor to consult with any such officer or person employed as aforesaid as regards any particulars required by this Section to be shown in the valuation roll, and generally

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for the purpose of carrying into effect the provisions of this Act, and such Regulations may modify and adapt the provisions of the Lands Valuation (Scotland) Act, 1854, and the Acts amending that Act. The Regulations shall be laid before both Houses of Parliament as soon as may be after they are made:

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Provided that if an address is presented to His Majesty by either House within the next subsequent twenty-one days on which that House has sat after the Regulations are laid before it, praying that the Regulations may be annulled, the Regulations shall thenceforth be void, without prejudice to the validity of anything previously done thereunder.—[Major Elliot.]